Promoting innovation requires innovative government policy. Innovation through the creation, diffusion and use of knowledge has become a key driver of economic growth and provides part of the response to many new societal challenges. However, the determinants of innovation performance have changed in a globalising, knowledge-based economy. Government policy to boost innovation performance must be adapted accordingly, based on a sound conceptual framework. Synthesising the results of a multi-year OECD project on national innovation systems (NIS), this publication demonstrates how the NIS approach can be implemented in designing and implementing more efficient technology and innovation policies.

Summary
Part I. Introduction
-Background
-Intermediary Findings of the NIS Project
-The Objective of This Report
Part II. Innovation through Dynamic Systems
-Towards a Dynamic, Innovation-Driven Economy
-The NIS Approach: Managing Knowledge, Interactions, and Institutions
-What are Interactions?
-Providing a Dynamism in Innovation Systems
-Dimensions of Growth in Innovation Systems
-Implementing the NIS Approach
Part III. Dynamism and Growth in Innovation Systems
-The Building Block: Innovative Firms
--Firms Growth through Transitions
--Firms Have Degrees of Freedom in Innovation
--Reinventing the Firm
--Non-Technological Innovation is Important
-Clustering of Innovative Firms
--The Cluster Concept
--Different Innovation Patterns in Different Clusters
--Key Factors in Cluster Development
-Networking in Uncertain and Rapidly Changing Environments
--Collaboration is Pervasive but the Intensity and Patterns of Collaboration are Country-Specific
--Domestic and Foreign Networks Reinforce Each Other
--Networking Extends to the Science System
--Government-Induced International Networking Generates National and Industry-Specific Spillovers
-Competing for Skills: Flows of Human Resources in Innovation Systems
--The Importance of Skills and Know-How
--Labour Mobility and Economic Performance
--International Mobility of Human Resources in Science and Technology
-Complex Interactions Create Resilient, Dynamic, and Adaptive Innovation systems
-Summing Up
Part IV: Dynamising Innovation Systems through Comprehensive Policy
-The Need for Coherent and Comprehensive Policy Making
-Structuring and Dynamising the Innovation Process
--Enhancing Firms' Innovative Capacities
--Exploiting Further the Power of Markets
--Securing Investment in Knowledge
--Promoting the Commercialisation of Publicly-Funded Research
--Promoting Cluster Development
--Promoting Internationally-Open Networks
-From Public Support to System Management
--Comprehensive, Coherent, and Customised Innovation Policies
--Prioritising and Sequencing Policies
--Policy Coordination to Improve Governance of the NIS
-Policy Learning
Concluding Remarks: NIS as a Benchmarking Tool
-Annex: The NIS Project
-The OECD Project on National Innovation Systems
-The Focus Groups
References